Super HD, 3D content only available to subs whose ISPs play nicely with Netflix.

Netflix recently said it will offer what it calls Super HD and 3D content—but only to customers whose Internet service providers agree to use Netflix's "Open Connect" content delivery network.

Cablevision, Virgin Media, British Telecom, Google Fiber, and others are on board. Time Warner is apparently negotiating with Netflix to connect to the private network, but it complains that its customers should get access to the crisper content without having to be a part of Netflix's CDN. “While they call it ‘Open Connect,’ Netflix is actually closing off access to some of its content while seeking unprecedented preferential treatment from ISPs,” Time Warner Cable said in a statement to Multichannel News. "We believe it is wrong for Netflix to withhold any content formats from our subscribers and the subscribers of many other ISPs. Time Warner Cable’s network is more than capable of delivering this content to Netflix subscribers today.”

Super HD is 1080p, but higher quality than Netflix's regular 1080p content. It requires 5Mbps download speeds at minimum and 7Mbps to get the best available quality. Netflix isn't charging ISPs to be part of its private network, but the ISPs do have to meet a list of requirements. For example, the ISP must connect to the same peering locations as used by the Netflix network and establish connections of at least 10Gbps. By requiring the use of its own network, Multichannel News notes that "Netflix saves money on third-party CDN transit fees by connecting directly with ISPs."

Netflix customers on ISP networks that aren't part of Open Connect will see the message "Your Internet provider is not configured for Super HD yet" at Netflix's Super HD page. "Please contact your Internet Provider to request that they join the Netflix Open Connect Network so you can get Super HD."

Netflix responded to Time Warner's accusation, telling Multichannel News that "Open Connect provides Netflix data at no cost to the location the ISP desires and doesn't seek preferential treatment. We hope Time Warner [Cable] will join the many major ISPs around the world who are participating in Open Connect to reduce costs, minimize congestion and improve data delivery to enhance the consumer experience."

At least one advocacy group agrees with Time Warner's position. The Competitive Enterprise Institute's Communications Liberty and Innovation Project—which typically opposes network neutrality requirements—accused Netflix of trying to "coerce ISPs into paying for a free Internet fast lane for Netflix content."

"With its 'Open Connect' model, Netflix is withholding content from the customers of ISPs that decline to accede to its demands," the group said. "Though the details of its demands are unknown, it appears Netflix is requiring that ISPs 'peer' with them or pay for the installation of Netflix equipment inside their networks as well as the ongoing costs of operating that equipment."

156 Reader Comments

But if netflix is doing this because it is cheaper than running the same data over its existing CDN partnerships... Why is it charging more for the customers who want it? Charging more for increased costs on their end makes sense to me.. but charging more for decreased costs? That sounds like gouging their loyal customers.

How are they charging more again?

Perhaps I'm misunderstanding, but there's a page to sign up for super HD... isn't there? If you need to opt-in to it, I'd assume that's due to a charge associated with it, otherwise they'd just upgrade it for everyone whose device supports the software.

No, it is automatic. If your ISP is set up properly, you'll be able to get the higher quality streams and some 3D content at no extra charge.

After that, more sports events are blacked out if you don't have a TV subscription to the right ISP.

After that, sports events can still be blacked out based on your geographical location.

I don't hear anybody crying about ESPN.

Sports broadcast blackouts are utterly ridiculous, but I don't care about sports that much so I let other people rage about it. Last time I went to a football game, they had a rule that said you were not allowed to Tweet, use Facebook, or any other social media during the game "without express written consent". That got a huge "fuuuuuuuck yooooouuuu" from me, but like I said I don't really follow sports much so it doesn't come up too often. If that example is indicative of the state of the situation, then I guess we've already lost.

Either that or everybody just willfully ignores those restrictions and still holds football parties and puts out tweets during the game and everything. Just try to enforce it you Nazi wannabees. Lets see how long your draconian terms hold up in a actual court of law. I suppose they probably put that binding arbitration clause in there as well though, so if they have a beef with you they summon you to NFL court in East Texas where judge NFL tells you how fucking guilty you are and orders you to pay a billion and a half dollars in restitution.

is it just me? from my living room, netflix's quality level is already very good in comparison to cable, satellite, or uverse. it's less blurry and compression artifacts are not as evident. only live OTA broadcasts and blu-ray discs are better.

for $8/month it's an incredible value. i honestly was not expecting this level of commitment after the whole quikster PR fiasco.

Not just you, no. I haven't had a cable subscription or antenna for years, using Netflix and sometimes Hulu to get the content I want which I don't have on DVD or BluRay. I've had really picky folks who see my streamed shows ask what kind of service I have because it's better than their cable provider's "HD" feeds. Netflix provides a fantastic value, IMO.

My issue is that they appear to be restricting the service regardless of whether your connection has the capability or not.

Running SuperHD streams out of their transit networks is likely not feasible from a cost perspective, at least not without raising prices.

With a peering agreement with an ISP, and the CDN servers located in a common POP they will literally run 1 or 2 pairs of singlemode OM3/OM4 between the CDN switches and the ISPs gear. Cost goes down for everyone, and quality goes up. Peering is free, transit is not.

The problem is Netflix isn't using its own online distribution network to deliver the content. They are forced to use someone else's network. It's like someone setting up shop in a lot behind your property which has no street access at all so if they wish to serve their customers they need to have them walk through YOUR property and home. This was no problem for a while but cable companies are starting to use more of their bandwidth for HD content and interactive content. Netflix's business model was destined to fail because it relied on charity from the owners of the networks they replied upon to deliver their services.

Actually the way Amazon's network works is you can turn on the tap for a 10g line to most of the major POP in North America. Which ever one the ISP chooses they already have peering agreements with others, and Netflix would effectively be peering directly as well just like any other network. I have no idea how much the gear costs, but I'm sure it's no more then the cost of your average router and some cable length for the ISP.

but I'm sure it's no more then the cost of your average router and some cable length for the ISP.

If the ISP and Netflix already have gear in the same POP then they already have switching and routing gear to get outside of that facility, best case is it costs $100-$1000 to pay the labor from the facility to plug a cable in from one rack to another.

It could be as simple as each end configuring two switchports on each end, and a tech plugging in two optical cables between the gear.

My issue is that they appear to be restricting the service regardless of whether your connection has the capability or not.

Running SuperHD streams out of their transit networks is likely not feasible from a cost perspective, at least not without raising prices.

With a peering agreement with an ISP, and the CDN servers located in a common POP they will literally run 1 or 2 pairs of singlemode OM3/OM4 between the CDN switches and the ISPs gear. Cost goes down for everyone, and quality goes up. Peering is free, transit is not.

Whether or not it is feasible from a cost perspective is irrelevant, with that argument Comcast could say that providing access to Netflix equal to every other site is not cost effective because they use so much more bandwidth.

I could understand if it is not technically feasible with the existing infrastructure. I don't have the background to say one way or the other. Other posters have alluded to the fact that it may not be technically feasible, though I have not seen anything that explicitly states that.

I use Comcast as an example because that is the ISP I am stuck with and have been a Netflix customer for over 10 years and generally happy with the service.

If Netflix doesn't want to pay for the bandwidth required to open this up to everyone, and only sends the extra data to ISPs that directly peer with them, I don't see an issue. This has nothing to do with network neutrality. Netflix isn't an ISP. I'm greatly amused that an ISP would scream about network neutrality though. It sort of shows that they're willing to claim anything when it suits them.

Really, I'm the only downvote for this comment? Network Neutrality isn't intended to be a two-way street?

If a netflix customer requests a high-quality stream, it is up to netflix to do what is necessary to deliver it. Even if that means that they have to upgrade the capacity of their content delivery network. It's not fair for them to pick and choose the 'winners' in the consumer internet-access marketplace. Just think of all the (potential) little local ISPs that won't have a chance because Netflix refuses to deliver their best products to their customers.

I was with Netflix in most posts about net neutrality, but on this issue I really have to be fair and stand on the side of Time Warner. This is not different that some ISP tried to do with traffic priority before. Netflix is basically giving you Super HD if you use "this ISP" and not if you use "this one"

How about global? Netflix streams way beyond the US today, do they except every ISP to join their open network? What if im in Alaska with a satellite connection? Or in some remote mountain, assuming I have a fast connection, discriminated because the ISP (which I the user choose) is not accepting Netflix rules?

This is almost the same as network neutrality violations, they are just hiding it under some marketing gimmick, the deal is that a ISP which does not agree to their rules does not get the same treatment. I don´t care if its free, this is just marketing. If every company starts to do this with their bandwidth carriers, peering and ISPs where will the internet end? With some VIP users having special access, and the rest of us? This is not how the internet was initially designer for. They are supposed to be able to deliver the same, regardless of where in the world you are. Otherwise they should build their own private LAN to each end user and close their Internet access. Internet should be open and this is nothing like open, Netflix rules gives you preference. This is violating net neutrality. Since when does network neutrality only apply to the Internet service provider? It has to be both ways if we want to be fair.

AFAICT the underlying subtext here is paid peering. Netflix doesn't want to directly or indirectly have to pay Time Warner to deliver bits to customers that have already paid Time Warner for the same bandwidth.

After that, more sports events are blacked out if you don't have a TV subscription to the right ISP.

After that, sports events can still be blacked out based on your geographical location.

I don't hear anybody crying about ESPN.

Sports broadcast blackouts are utterly ridiculous, but I don't care about sports that much so I let other people rage about it. Last time I went to a football game, they had a rule that said you were not allowed to Tweet, use Facebook, or any other social media during the game "without express written consent". That got a huge "fuuuuuuuck yooooouuuu" from me, but like I said I don't really follow sports much so it doesn't come up too often. If that example is indicative of the state of the situation, then I guess we've already lost.

Either that or everybody just willfully ignores those restrictions and still holds football parties and puts out tweets during the game and everything. Just try to enforce it you Nazi wannabees. Lets see how long your draconian terms hold up in a actual court of law. I suppose they probably put that binding arbitration clause in there as well though, so if they have a beef with you they summon you to NFL court in East Texas where judge NFL tells you how fucking guilty you are and orders you to pay a billion and a half dollars in restitution.

If you cannot stop tweeting or sms,etc for at least 80 minutes, then you have a real issue.

I don´t see why that is so wrong in your view, not only in sports events, but in any event which is supposed to have human behavior involved. If someone wants to look their phone all night, they can better stay at home. I find it completely insulting when someone is in a group conversation and someone is using their phone to tweet while others are talking. Technology is supposed to get you closer to people when they are not there, its not supposed to distant you from the ones that are here.

I am kind of surprised by the response on this. Maybe I am missunderstanding, but as I see the issue, Netflix is saying to its users that they can't get access to the best quality content unless they are using a preffered ISP.

My expectation of my Netflix account is that I always get the best quality picture available based on the bandwidth/quality of my connection regardless of if I am on my home ISP or cellular or some random wifi.

In my mind this is a big violation of the idea of net neutrality since you get preferential treatment from Netflix based on what ISP you use.

It is similar to the idea of restricting content based on geographical location, which I also don't agree with even though it is standard practice.

I think you're misunderstanding what Netflix is trying to do. The cable companies are charging Netflix based off of bandwidth used. Since Netflix uses more bandwidth nationally then porn, that's a huge portion of their costs. In order to keep the ISPs from arbitrarily increasing the cost of said bandwidth to promote their own offerings, Netflix is offering a superior service to customers of ISPs who get on board with it. This keeps ISPs from increasing the cost, which in turn would make Netflix increase their costs, by having customers basically demand that the ISPs give Netflix free bandwidth so the customer gets superior service.

Basically, Netflix is beating ISPs at their own game. It's rather clever. Only time will tell if it will work.

This has to be Netflix's response to Comcast basically wanting to charge for Netflix data a while back...

Comcast: we're going to charge for you data.Netflix: Here, if you have our data for free your customers can get the best quality service.Customers: We want the best quality!

This was a genius move on Netflix's part. Make the ISP out to be the bad guy or get guaranteed free pipes into their network to provide the content. Either way they win with consumers and have something to lobby with at the end of the day.

They want to charge Netflix for data Netflix delivers to TWC customers. That's not the way the internet works, but previously it has just been a "we're all friends here" kind of thing. This kind of deal is looking to lock the ISPs into behaving properly since they can't be trusted to do the right thing on their own.

Glad to see how many of us Techies can see though the bullshit here. It's refreshing.

If you cannot stop tweeting or sms,etc for at least 80 minutes, then you have a real issue.

I don´t see why that is so wrong in your view, not only in sports events, but in any event which is supposed to have human behavior involved. If someone wants to look their phone all night, they can better stay at home. I find it completely insulting when someone is in a group conversation and someone is using their phone to tweet while others are talking. Technology is supposed to get you closer to people when they are not there, its not supposed to distant you from the ones that are here.

I love how they bring up net neutrality arguments, when one of the arguments AGAINST net neutrality is that it would hinder "innovation", as prioritized bandwidth is somehow required to innovate for the future. And yet here they are crying out against Netflix rolling out a new future that it wants to be able to deliver seamlessly. They even say

Quote:

... join the many major ISPs around the world who are participating in Open Connect to reduce costs, minimize congestion and improve data delivery to enhance the consumer experience.

I think this is one of the better ways that ISPs have been shown to be flat-out against the consumer, pretty much unarguably. We can say it as much as we want, but to have someone as big as Netflix come and call the dissenters out like that is great.

Maybe some providers need to look up innovation in a dictionary.

The problem is Netflix isn't using its own online distribution network to deliver the content. They are forced to use someone else's network. It's like someone setting up shop in a lot behind your property which has no street access at all so if they wish to serve their customers they need to have them walk through YOUR property and home. This was no problem for a while but cable companies are starting to use more of their bandwidth for HD content and interactive content. Netflix's business model was destined to fail because it relied on charity from the owners of the networks they replied upon to deliver their services.

No, it doesn't, because each person that wants to do business with Netflix has to pay the you for the privilege of walking through your property to get to them. That's how the internet works. That's also the reasons ISPs should be legally prevented from being in the content creation an delivery business. It creates perverse incentives where they can make more money by failing at their primary job we pay them to do.

I love how they bring up net neutrality arguments, when one of the arguments AGAINST net neutrality is that it would hinder "innovation", as prioritized bandwidth is somehow required to innovate for the future. And yet here they are crying out against Netflix rolling out a new future that it wants to be able to deliver seamlessly. They even say

Quote:

... join the many major ISPs around the world who are participating in Open Connect to reduce costs, minimize congestion and improve data delivery to enhance the consumer experience.

I think this is one of the better ways that ISPs have been shown to be flat-out against the consumer, pretty much unarguably. We can say it as much as we want, but to have someone as big as Netflix come and call the dissenters out like that is great.

Maybe some providers need to look up innovation in a dictionary.

The problem is Netflix isn't using its own online distribution network to deliver the content. They are forced to use someone else's network. It's like someone setting up shop in a lot behind your property which has no street access at all so if they wish to serve their customers they need to have them walk through YOUR property and home. This was no problem for a while but cable companies are starting to use more of their bandwidth for HD content and interactive content. Netflix's business model was destined to fail because it relied on charity from the owners of the networks they replied upon to deliver their services.

What charity? I pay pay for my bandwidth and Netflix pays for theirs. Why should TWC get to double-dip?

I don't think TWC has data caps, certainly not in my metro market. They are not Comcast.

TWC is not scared of losing customers over this. In fact, their ads push themselves as having the best data pipes for your online entertainment. And, why not? Internet service is the real cash cow, not cable TV. It is to their advantage to have more people buying Internet service rather than TV packages. The only disadvantage to them is subscriber count leverage when dealing with Hollywood.

1.) they do (it's just like 600-800gb similar to cox/comcast) and is dependent on your tier.

2.) Keep listening to their ads(and then realize how dumb your claim sounds.), but I've not seen a single TWC cable plan anywhere that beats what the competition offers. They have only provided mediocre speed pipes in areas theres little to no competition.

I understand that the Internet has bandwidth limitations, and maybe my complaint is a little bit of semantics, but it appears that Netflix is saying that regardless of whether or not you have the available bandwidth, we will only provide the content to preferred ISPs. It's the difference between saying that your connection isn't "good" enough to support the content so contact your provider about a better connection, and saying that your provider won't enter into an agreement with us so we won't send you to content until you badger them into complying.

Maybe the Open Connect network is the only way to provide a big enough pipe, but I have not seen anything saying that.

It's less that they need bigger pipe than that they need 'cheaper' pipe. ISP's like TWC and Comcast have gone on record as wanting to gut Netflix for all the blood money they can get to access NF on their services.

If Netflix had NOT done something this this, they would have eventually been forced to raise prices on EVERYONE to accomodate the greed of a few large ISP's and their unreasonable demands. THAT, to me, would have been unfair to consumers.

Here's what this is about...if Netflix can place a CDN inside the ISP's network, then it bypasses data caps. This was Comcast's argument for their system, so Netflix is playing by their game. TWC wants to keep data caps as a penalty for Netflix users to keep them from cutting the cable TV cord.

This is about the cash cow that is data usage caps and TWC is scared of losing customers over this.

I'm beginning to expect a world where there is only cable TV and Netflix... Because so few have the power to push for this kind of treatment, and our Government has failed to deal with data caps that don't count internal packets.

I think you're misunderstanding what Netflix is trying to do. The cable companies are charging Netflix based off of bandwidth used. Since Netflix uses more bandwidth nationally then porn, that's a huge portion of their costs. In order to keep the ISPs from arbitrarily increasing the cost of said bandwidth to promote their own offerings, Netflix is offering a superior service to customers of ISPs who get on board with it. This keeps ISPs from increasing the cost, which in turn would make Netflix increase their costs, by having customers basically demand that the ISPs give Netflix free bandwidth so the customer gets superior service.

Basically, Netflix is beating ISPs at their own game. It's rather clever. Only time will tell if it will work.

It seems like a good move to me... Netflix, despite their missteps in the last year or two, still has quite a lot of consumer goodwill, name recognition and market share. If they can implement this in a reasonable timetable, it will allow them to leverage those assets into forming longer term agreements with some of their biggest corporate detractors, creating a solution in the face of the growing competition from the likes of Amazon, Hulu, et al.

One the one hand, this is genius, I think. On the other hand, it's too bad they didn't think of this a few years ago before all of the missteps happened and they really did hold all the cards.

Maybe, maybe not. We know Comcast is charging Level 3 who is presumably trying to pass those costs on to Netflix. We don't know what's going on with other ISPs; they may actually be buying transit to receive Netflix in which case Open Connect would save them money.

Unfortunately, this does mean that Netflix would get preferential treatment from ISP's in relation to other services (i.e. Hulu,Youtube, etc.), thus it does actually trip the net neutrality alarm. If Netflix gets a uncapped pipe direct to ISP subscribers, then all CDN's should get a uncapped pipe to ISP subscribers. The fact that Netflix gets an exclusive deal with the ISP's means it isn't neutral.

Open Connect provides Netflix data at no cost to the location the ISP desires and doesn't seek preferential treatment.

If this is true, what is TWC's malfunction?

The issue is that Netflix is asking these companies to host their CDN servers for free. I.e. Netflix provides the servers, TWC provides the datacenter hosting. That datacenter space and the engineering resources necessary to make it all work aren't free to TWC.

If anyone else trying to build a CDN came to TWC with this deal, they'd show them the door. Every other CDN that does this pays the ISPs a pretty hefty amount of money for the hosting and/or interconnects. Netflix is trying to save money over paying their current CDNs by pulling an end-around and building their own. If they want it to work, they'll need to play by the same rules.

The ISPs wouldn't be obligated to host a damned thing. They'd have to use PEERING, nothing more. Peering is interconnecting their networks in a facility somewhere, typically a third party one. That actually benefits both parties as it will give the ISPs another route to other networks, which will allow them more redundancy. You need to read up on peering as you clearly don't understand it. It's a key part of how the Internet operates.

Edited for clarity. Pre-coffee comments FTW!

I fully understand how the internet works (both from a technical and a business side,) and that there are multiple options (including interconnects) to participate in OpenConnect. For small ISPs, this is fine and an interconnect does the trick. Problem is, for an ISP on the scale of a TWC or a Comcast, you basically end up having to host a CDN edge cluster in every major market you have. Co-location of CDN servers is essentially the only option; and Netflix isn't willing to pay to operate a CDN within a major ISP. Which is what everyone else does; interconnects just don't cut it when you're talking this much data; you need to be as close to the edge as possible, which for major telcos or cable ISPs that can have over a million users in a metro area means you need to host your CDN inside their datacenter.

Netflix pays to host content on other CDNs as well. Problem is, those CDNs are now refusing to sell Netflix more bandwidth at any cost, because essentially they're dedicating too much of their network to Netflix and its degrading their services for their other customers. The TWCs of the world already receive lots of money from those CDNs, and they're not going to let Netflix do an end run around them (and cost them money) without being paid for it.

Netflix is pitching this like it's a slam-dunk because its in their best interests to do so. But it's not so simple; and in fact the reason we still have cable and satellite TV is because cable/satellite companies are just primitive video CDNs themselves (albeit with a multicast last-mile capability.) Netflix is looking down the barrel of a serious scalability problem right now; and they're trying to get it solved for free.

But if netflix is doing this because it is cheaper than running the same data over its existing CDN partnerships... Why is it charging more for the customers who want it? Charging more for increased costs on their end makes sense to me.. but charging more for decreased costs? That sounds like gouging their loyal customers.

How are they charging more again?

Perhaps I'm misunderstanding, but there's a page to sign up for super HD... isn't there? If you need to opt-in to it, I'd assume that's due to a charge associated with it, otherwise they'd just upgrade it for everyone whose device supports the software.

No, it is automatic. If your ISP is set up properly, you'll be able to get the higher quality streams and some 3D content at no extra charge.

The URL is misleading. The URL's FQDN is "signup.netflix.com" which if someone didn't follow the link to read the information page then it could lead to assumptions.

BTW, that was a much nicer way of putting it than the last person's post.

Unfortunately, this does mean that Netflix would get preferential treatment from ISP's in relation to other services (i.e. Hulu,Youtube, etc.), thus it does actually trip the net neutrality alarm. If Netflix gets a uncapped pipe direct to ISP subscribers, then all CDN's should get a uncapped pipe to ISP subscribers.

I have no sympathy for the ISPs' griping here. You made this bed with your constant whining about Netflix using up your CDN bandwidth and your crying poormouth about upgrading capacity, trying to overturn net neutrality rules... now lie in it.

I see this as a burden for small independent ISPs. I agree that edge CDN nodes installed as close to the customer (ie: inside the ISP) go a long way to reducing the back-end bandwidth requirements for such a service but the up front investment and ongoing operational costs may prove to much for indie providers operating on slim margins to swallow. However if the investment can be shown to be recovered via significantly lower backhaul costs for them then it makes sense. If Netflix makes this as easy as possible maybe it will actually be a boon for providers who resist caps?

Who is the "Competitive Enterprise Institute" exactly? These advocacy groups like to pretend they are spontaneous groups of concerned citizens, but rarely are.

Libertarian Think Tank, like other so called think tanks their job is to bend any story to fit their worldview and to espouse said worldview on any public venue that will allow them to talk.

It's like inviting the Cato Institute over for talks about regulating businesses. No matter how sensible the regulation or how much public good it might do, they will always and forever be against it because that's their position on regulation.

More likely it's astroturf. Pure libertarian ideology would say that this is a voluntary decision by two private companies.

Here's what this is about...if Netflix can place a CDN inside the ISP's network, then it bypasses data caps. This was Comcast's argument for their system, so Netflix is playing by their game. TWC wants to keep data caps as a penalty for Netflix users to keep them from cutting the cable TV cord.

This is about the cash cow that is data usage caps and TWC is scared of losing customers over this.

I don't think TWC has data caps, certainly not in my metro market. They are not Comcast.

TWC is not scared of losing customers over this. In fact, their ads push themselves as having the best data pipes for your online entertainment. And, why not? Internet service is the real cash cow, not cable TV. It is to their advantage to have more people buying Internet service rather than TV packages. The only disadvantage to them is subscriber count leverage when dealing with Hollywood.

Internet service is the real cash cow because TWC and others charge the same amount for Internet service as many TV packages. I pay $60/month for 30Mbps service. That price is at least a 120 channel TV package, which contains channels which have to be negotiated with media providers. And, they all want a share of the $60 collected on the TV package. The cost to deliver $60 Internet service is much lower due less negotiation requirements, less lawyers, less everything. Internet service, in the end, provides more gravy for TWC and others.

They want you to buy their internet service, there phone service, and their TV service. They want to sell every service they have.

Why is everyone praising Netflix? This is just a back end move to acquire more money from ISPs to offset the cost of their backend delivery services. Its taking advantage of the turmoil to play both sides, just like ISPs want to play both sides.

The only reason this is occurring is because ISPs and Ma Bell failed/lied about/refused (take your pick) to upgrade the entire network in the first place, despite government mandates. Otherwise congestion and bandwidth resources wouldn't be an issue. Coupled with ISPs overselling their network (ie like Airlines overbooking their flights to ensure 100% capcacity), and we have the situation today.

For once, I actually agree with TWC although their hearts are likely in a different place, and just don't want to shell out the money.

So many ISP shills in here, desperately trying to portray Netflix as the bad guy...

Wouldn't say I'm a shill; but I do work in the industry. Simple fact is that transit agreements are not free for *anyone*. If you want an interconnect with a last mile provider, you have to pay for it. The rates are less than you would pay a CDN, but it's not free. Netflix doesn't want to pay. So TWC et al are saying 'Fine; if you don't want to pay us to send your data, you can pay someone else who does pay us.'

This is how the Internet works: if you have data you want to offload, you have to pay for it. If you are willing to accept data, you get paid for your service. Peering (i.e. running a fiber line between two networks) only happens when both networks send and receive about the same amount of data. It may not sound fair, but it's how business is done. What you pay your ISP covers the cost of the last mile network. What the CDNs and interconnects pay covers getting it to the last mile. When you're pushing petabytes of data per day like Netflix, that's expensive. That money goes to constant upgrades aimed at increasing capacity in the last mile networks. It's not like the telcos/cable just pocket it; their margins are pretty slim.

Shill or not; Netflix isn't playing by the rules here. Besides, I'd bet money they're paying everyone on the list (because small ISPs are especially dependent on transit payments) and this entire kerfluffle is a negotiating tactic aimed at lowering the price they pay to the TWCs and Comcasts of the world. But negotiating tactic or not; the rules of the Internet are the rules of the Internet, and Netflix doesn't get to ignore them just because I like watching Downton Abbey.